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Homebuilders stocks started the day off on the right foot. Seasonally adjusted housing starts jumped 12 percent month-to month, sending stocks higher, while economists patted each other on the back.
“What they failed to mention is that 30 percent of all housing starts in 2012 were of multi-family apartments,” wrote CNC’s Diana Olick. Citing date from housing analyst Mark Hanson, Olick says single family construction may in fact be slowing.
“Single family starts did ‘improve’ suddenly early in 2012 on the Twist gap down in mortgage rates, but it quit ‘improving’ several months ago. Once 2013 data start to come in, the segment could quickly go from year-over-year positive to year-over-year negative over the period of a month or two,” said Hanson. “Multi-family has reached escape velocity; single-family is stuck in the mud.”
A number of stocks including D.R. Horton (NYSE: DHI), Lennar (NYSE: LEN), KB Home (NYSE: KBH), Hovnanian (NYSE: HOV), Ryland (NYSE: RYL), Toll Bros. (NYSE: TOL), PulteGroup (NYSE: PHM) rolled over following the report.
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